Without so much as part of $15 million in requested funding included in the state’s recently approved $40.8 billion budget, it’s back to the drawing board for a plan to build a hotel and conference center in downtown Frederick.

Developer Plamondon Hospitality Partners’ proposal relies on a combination of state government funds and county and city tax revenue generated from the project to fund about one-third of the $64 million cost. The $22 million — $15 million from the state and $7 million in tax revenue — would fund only the public portions of the project: the conference center, on-site parking spaces, utilities, road improvements and land at the site of the old The Frederick News-Post building at 200 and 212 E. Patrick St.

Plamondon would pay the remaining $42 million for the 207-room hotel and its amenities, plus a small portion of the 23,459-square-foot conference center meeting space.

Richard Griffin, the city’s director of economic development, said he was not altogether surprised that the project didn’t get funded in what he described as a “very austere budget,” despite unanimous support and continued advocacy from the Frederick County delegation.

But without state funding, the slow-moving project may be further delayed or modified.

“It does mean we need to take a step back and regroup,” Griffin said.

According to Griffin, the decision boils down to three options: place the entire project on hold with the hope that requesting state funding in the next year’s budget will be successful; proceed as planned by getting the project “shovel-ready” with all necessary permitting, site plan approval and finalizing a memorandum of understanding between the city and the developer; or some action between these two ends of the spectrum.

Alternatively, the developer could fund the entirety of the project itself, making city approval and state funding unnecessary. That option is unlikely, Griffin said, since the public-private partnership was born from the results of two studies showing a developer would need financial help to make such a project profitable.

No decisions have been made, according to Griffin, who said the groups involved haven’t met since the state budget was approved.

John Fieseler, a member of the advisory team and executive director of the Tourism Council of Frederick County, indicated that certain components of the project can move forward even without the funding.

“There’s so many aspects of this,” he said. “From the city side, there are a lot of other things that have to happen.”

These include a study to determine if an additional parking garage is needed and the MOU, which Pete Plamondon Jr., co-president of the development company, said he hoped will be ready for review by the Mayor and Board of Aldermen in the next 30 days.

“We’re very close to 100 percent agreement,” Plamondon said of the MOU.

Delegates react

Several Frederick County delegates pledged to continue pushing the downtown hotel and conference center project for funding in the next fiscal year’s budget.

Delegate Carol Krimm, D-District 3A, said she was hopeful the governor would include money for the project in the next budget.

“I wouldn’t extend the effort if I didn’t think there would be a positive outcome,” she said.

Delegate Karen Lewis Young, D-District 3A, described the project as a top priority for county representatives, and expressed surprise that even a minimal amount of project funding was not included in this year’s budget.

“Within the scheme of a $40 billion budget, $7.5 million, or even $5 million, that’s just seed money,” she said.

The city originally requested $15 million from the state’s budget, which delegates chose to split into two $7.5 million requests — to be split between the 2015 and 2016 budgets — given the conservative budget expected from Gov. Larry Hogan.

“I still think it’s realistic, but of course, I thought it was realistic this year,” said Lewis Young of the plan to present the same funding request next year.

Lewis Young also suggested exploring other options, such as including more private investors or investment tools.

Her husband, state Sen. Ron Young, D-District 3, advocated for an alternative option to state funding as well.

“I don’t think he’s going to fund a hotel,” Young said of Hogan. “I think we had a chance to get some funds in the last administration, but it’s going to be more difficult yet.”

Instead, Young proposed reallocating the funds designated for the project’s parking to the conference center, and expanding the public-private partnerships proposed for the project.

Economic benefits

Supporters have praised the project’s economic benefits for the city and the county extensively.

Fieseler described it as “the next big gamechanger for Frederick.”

Plamondon crowned it the “biggest economic development downtown Frederick has ever seen,” apart from Carroll Creek Linear Park.

According to a study conducted by the Maryland Stadium Authority in 2010, the project would create 280 jobs, 110 at the hotel itself and the rest indirectly at other area businesses based on the increased traffic to the area. The project’s estimated economic impact totals over $25 million annually, including both direct and indirect spending. It would generate $1.5 million in state taxes per year.

The project has been well-received by the public because of these economic benefits, Plamondon said.

But Lewis Young noted that the project plans could be reframed to better highlight these benefits, which might make Hogan more willing to provide funding in the next budget.

“We need a package and a business plan that resonates with him,” she said.

Continued commitment

Plamondon pledged continued support to the project as it has already been designed, despite the setback in state funding.

Of changes to the design, “we really haven’t gone down that path,” he said.

Griffin also maintained the city’s commitment to the project.

“We continue to believe it’s not only worthwhile but a very fundable project,” he said.

Follow Nancy Lavin on Twitter: @Nancy_Lavin228.

Nancy Lavin covers social services, demographics and religion for The Frederick News-Post.

(35) comments

HappyMedium

Who can go over and count the number of cars parked in the Carroll Street parking deck each hour of every day of the week so we can get some raw data on current resource utilization and I am not talking projected resource utilization, I want to know actual resource utilization.

If we have reserved spaces on the lowest levels for the hotel patrons we can push everyone else up to higher levels.

HappyMedium

These hospitality industry employees are going to need affordable house. What's in the works for that.


Earnings and Hours of All Employees
Average hourly earnings...$14.23
Average weekly hours...........26.2

Annual income..................$19387

They won't be able to have to two jobs because they'll be required to work any shift on zero notice.

DickD

No tax dollars for Plamondon to make profits. Let them go to the bank, the same as the rest of us would have to.

KellyAlzan

Build the hotel at the old mall property and then parking won't be an issue

HappyMedium

What demand is there going to be for hotel rooms after they build another hotel in Jefferson Technology Park now that they have eliminated that "dry" zone.

KellyAlzan

This hotel deal will make Karen a one term politician. We don't not want the hotel.

nbouqu1

should have been a zero term. But I may be biased...

ESF530

Personally I'm happy to read this and hope the funding never happen. Downtown needs a hotel and conference center as much as Frederick needs a third Wal Mart.
Of course, these businesses may be good for the economy. Haa any one else thought about traffic downtown? Which us bad enough without a hotel and conference center.
Now a third Wal Mart, Wal Mart I and II can't get or keep worker, lines are long, employees are rude, and customer service is non-existent. Also, there has been talk about moving Wal Mart II to the other side of Route 26 and leaving yet another vacant building.
When are you people going to wake up and realize none of these so called improvements are "good for
Frederick"

HappyMedium

When you go ask Daddy Warbucks for more money he is going to say "No".

klewisyoung

When you expand the commercial base, you obtain the tax dollars to support schools and roads.
With the completion of Carroll Creek Linear Park, a downtown hotel, and the first phase of East Frederick Rising, there will be sufficient demand for three garages.
Hotel patrons and conference attendees expect convenient parking.

KellyAlzan

I'm sorry Karen. But the developer can develop on his own without may tax dollars and expand the commercial base.

We don't need a hotel downtown. It's foolish.

Let's fix I-270

HappyMedium

Expand a commercial base, get real the only thing that has happened so far is a software company currently located on Church Street is moving to Carroll Creek Linear Parkway. That is not expansion that is redistribution.

The County owns three empty buildings in downtown Frederick. Produce a name of one private sector commercial enterprise with good paying jobs that wants to be here and I'm not talking about something in the restaurant, retail, or hospitality industry that pays poorly and has no benefits.

HappyMedium

What's the point in putting more millions into a parking deck when there is one at Carroll and All Saints that is empty most of the time.

Have you never tried to park in a major city; walking one block on the same side of the street is convenient parking.

Carroll Street Parking Deck

klewisyoung

I do not support taxpayer dollars to subsidize the hotel. I do support some investment in the infrastructure (i.e. parking garage) that would support the conference center. This has a public purpose and benefit.
Frederick is the second largest city in MD and should have a downtown hotel and conference center. We are missing major economic development opportunities. The Major Employers Group has been telling us that for years.
This project is projected to generate $25.8 million in direct, indirect, and induced spending annually; $1.5m in annual state taxes; 280 total jobs (110 direct jobs at the hotel with a payroll of $2.9m annually); and payroll earnings in excess of $9m annually.
This job retention and creation potential, as well as the other economic benefits, is why I support the project. Also, the ROI on tax payer investment is likely to be ten years or less.

HappyMedium

Frederick might be the second largest city but it is located in a county of only 250,000 people unlike Montgomery County where there are 1,000,000 people.

Frederick could not support a convention center and who ever made these projections needs their head examined.

Frederick has a $5 million payment coming up on the Airport soon are they going to be able to make it while still owing the $5 million principal on bonds for the golf course which was purchased in the last century.

HappyMedium

Since the study was completed Bechtel announced it was leaving and taking it's high paid employees with them.

Your husband made alcohol available for the Jefferson Technology Park so they could now have a conference center.

Downtown Hotel & Conference Center

HappyMedium

Did your lovely study take Sequestration into account or that gene therapy would predominate cancer treatment in the next five years so instead of creating one treatment that will work on many the focus will shift to individualized treatments that are targeted for specific people making smaller regional facilities more efficient.

It's time to get cancer treatment research out of the public sector and back into the private sector where it belongs.

barbaradean8

and no tax dollars for any stadiums for sports teams EVER!

DickD

Unless they are for our schools.

jerseygrl42

If this so-called investment can't stand on its own 2 feet , then it should NOT happen...why on earth should the taxpayers foot a significant piece of the cost so that a multi-million private organization can't make yet more profits....ridiculous notion and its all about the taxpayers MONEY

BstD59

This is the best news I've heard coming out of the city. The city has no need for a convention center/hotel and I don't know of many taxpayers who are supportive of it.

If the government needs to spend our tax dollars then let them spend it on things that will be favorable to all such as education and our infrastructure, especially our road systems.

fmd4life

Sallyforth, you're exactly right! I expect those kind of views from Ms. Young (and generally from her husband) For a change, the state is doing the right thing. Additionally, if this project is such a great boon, why is it that the developer needs to rely on government funds as opposed to funding it through private sources? Government has no legitimate role in these kinds of issues at all!

Sallyforth

Karen Lewis thinks that $5 million is nothing. Of course not, not to a politician spending our tax dollars.

armillary

Fund schools first.

Dwasserba

"The project has been well-received by the public" (???)
I'll bite. When was that?

This seems like a situation where people with titles and money and position just talk to each other very enthusiastically. At least Ron pokes his head out from under the dome once in awhile.

DickD

"Alternatively, the developer could fund the entirety of the project itself, making city approval and state funding unnecessary. That option is unlikely, Griffin said, since the public-private partnership was born from the results of two studies showing a developer would need financial help to make such a project profitable." So, we need to put up tax money so Plamondon can make money? I say forget it, we don't need companies that are unable to stand on their own.

dcg326

No tax dollars ,just let hotel chain pay.We are done paying, you elected supporters.We own 2 MD stadiums Ravens and o's enough taxing.

DickD

Right you are!

KellyAlzan

270 is an absolute nightmare. And in desperate need of widening.

And you're freaking worried about a stupid hotel???????

barbaradean8

no tax dollars at all!

DickD

Amen!

HappyMedium

The spending spree is over, isn't education funding more important than an empty conference center. You've already spent $15 million on the Carroll Creek expansion.

Perhaps your husband never explained to you that if you only have enough money to buy one hat and you have to choose between two hats, you can't come home and ask for enough money to buy the second hat. Well I've done that now so there are no excuses for not understanding money doesn't grow on trees, straw can't be spun into gold, and there is no pot of gold at the end of a rainbow.

So now I expect you'll go looking for a four leaf clover.

But Lewis Young noted that the project plans could be reframed to better highlight these benefits, which might make Hogan more willing to provide funding in the next budget.

HappyMedium

Why don't you just drop the conference center.

Federal spending for $16 muffin breakfasts has dried up.

kimberlymellon

[thumbup]

Welcome to the discussion.

Keep it clean. Please avoid obscene, vulgar, lewd, racist or sexually-oriented language.
Engage ideas. This forum is for the exchange of ideas, insights and experiences, not personal attacks. Ad hominem criticisms are not allowed. Focus on ideas instead.
TURN OFF CAPS LOCK.
Don't threaten. Threats of harming another person will not be tolerated.
Be truthful. Don't knowingly lie about anyone or anything.
Be nice. No racism, sexism or any sort of -ism that is degrading to another person.
No trolls. Off-topic comments and comments that bait others are not allowed.
No spamming. This is not the place to sell miracle cures.
Say it once. No repeat or repetitive posts, please.
Help us. Use the 'Report' link on each comment to let us know of abusive posts.